This page has been archived and commenting is disabled.

Steen Jakobsen: Expect A 30% Stock Market Correction in 2014

Tyler Durden's picture


Submitted by Adam Taggart of Peak Prosperity,

This week, Chris talks with Steen Jakobsen, Chief Investment Officer of Saxo Bank. We wanted to see through the eyes of a professional economist, which Steen kindly allowed us to do.

Steen agrees that central banks have largely failed in their misguided attempts to boost growth via trickle-down programs. Pretty much all the benefits of the recent years of money printing have gone to the upper echelons, with the true engines of growth and jobs -- small to medium sized enterprises (SMEs) -- getting very little.

As a result, financial asset prices have been driven up too high, which Steen anticipates will correct at some point in 2014; likely by 30% or so:

Here is my practical view. Since Q3 of last year I’ve been 70% in fixed income because I do believe, and I continue to believe, that we’ll see new low interest rates. In a world that cannot restart itself, it a world that believes in 'extend and pretend', you will not have any activity. You don’t have any move towards a mandate for change. So that means that history tells us the only way we get change is through the system failing. I’m not talking about a systemic failing; I'm talking about people owning up to the fact that we need to activate the SME. So I think we’ll see a progression towards helping the SMEs.


But in terms of the market, I have been very on fixed income, an increase in the exposure right now from 70 to 90% taking whatever equity I have down. Not because I’m afraid of 'doom and gloom' but simply because I think you can have a huge amount of leverage into the fixed income market here when everybody seems to believe that interest rates cannot go lower -- now confirmed today by the Q1 data from the US. The world is simply starving because the world is rebalancing. The US current account deficit moved from -800 to -400. The world needs $400 billion worth of new export markets before it gets back to break even.


At the same time, Asia and China certainly are rebalancing their way from nominal growth towards quality growth. Again, the first derivative of that is lower growth, deflation, exported to the rest of the world.


So I think the low comes in economically in Q1 and Q2 in 2015. Every single macro indicator you can find will bottom at Q1/Q2. For the equity market, I think the top is 1900/1950. But you can't both predicted the level and the timing. And I’m more confident about the timing, not the level. So my timing I’m confident, and the timing I am confident on is the fact that the second half of this year is going to see a 30% correction from the top.

He also agrees that rising energy costs and overall resource scarcity are real threats to future economic growth; threats that he believes most economists and investors are blind to.

On all the above, we're in agreement with Steen.

In other areas, our predictions differ. But that's why we have guests like him on the program: to hear the rational behind contrasting views, and to learn what those moving large sums of capital in today's markets are thinking.

Despite the near term likelihood of a major correction, Steen remains quite optimistic. He believes that the correction will be a clearing event not just for overly-elevated prices, but also will serve as a wake-up call about the net energy situation that will lead to better policy decisions. We sure hope he's right, but we sadly think it will take a major price shock or supply shortage of key commodities to get the attention of our leaders.

Click the play button below to listen to Chris' interview with Steen (42m:43s):



- advertisements -

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
Mon, 06/02/2014 - 20:07 | 4818543 Aknownymouse
Aknownymouse's picture

Yea yea yea. Been waiting for 5 years. Not happening apparently.

Mon, 06/02/2014 - 20:25 | 4818576 Beam Me Up Scotty
Beam Me Up Scotty's picture

"Steen agrees that central banks have largely failed in their misguided attempts to boost growth via trickle-down programs."

Trickle down!!!  LOL!!  This is TRICKLE UP at its finest!!!!!

If we are lucky we will get a 3% correction.  You can kiss the days of 30% corrections goodbye!!  They own the printing press, therefore, every single number you see on CNBS is goalseeked!

Gold DOWN, S&P UP!!

Mon, 06/02/2014 - 20:26 | 4818593 Slave
Slave's picture

I don't know about you, but this article gave me a fucking huge erection.

Mon, 06/02/2014 - 20:47 | 4818646 zerozulu
zerozulu's picture

Situation is so fragile that this 30% will bring unrecoverable hangover.

Mon, 06/02/2014 - 21:20 | 4818727 NoDebt
NoDebt's picture

He's been 70% bonds since Q3 of last year.  Yeah, I've been cash-heavy and bond-heavy since then, too.  Glad to know he's had his ass handed to him just like I have.

Mon, 06/02/2014 - 21:24 | 4818735 markmotive
markmotive's picture

A 30% drop would be great. Bring it on!

Mon, 06/02/2014 - 21:52 | 4818805 THX 1178
THX 1178's picture

Would a drop such as this bring the untaper? Would it? Or woul;d Belgium just ramp up its purchases? I'm sorry, I mean "Belgium"

Mon, 06/02/2014 - 23:42 | 4819110 BlindMonkey
BlindMonkey's picture

Peak boner.

Tue, 06/03/2014 - 00:37 | 4819234 Kirk2NCC1701
Kirk2NCC1701's picture

I'd get a big woodie if this damn Correction finally came about and also corrected the damn Real Estate market. 

Especially in the over-priced areas, so we could BTFD.  It's my turn to get even, dammit!

Wed, 06/04/2014 - 01:46 | 4822329 Mr. Ed
Mr. Ed's picture

I'd like to see that!

but, you can be sure brokers'll be out there telling every lie and fairy tale in the book to keep the bigger fools a comin'.

Mon, 06/02/2014 - 21:20 | 4818723 Carpenter1
Carpenter1's picture

at this stage, there could never be a 30% correction. 6% or 80%

Mon, 06/02/2014 - 22:46 | 4818974 playnstocks
playnstocks's picture

We're seing the correction right now in the futures.. S&P down 1.25 -.07%.. Thats the selloff..


bbbbbbbuy BTFD..BTFATH-MFrs

Wed, 06/04/2014 - 09:24 | 4822782 LooseLee
LooseLee's picture

Well, looks like the PINKO COMMIES have secured your soul. If you are not part of the solution you are part of the problem. Sorry to see you have been converted to the 'wrong' team...

Mon, 06/02/2014 - 20:38 | 4818621 HaroldWang
HaroldWang's picture

Yep. Cue Dr. Doom too. He'll say the same. That's what these guys do. PERMA BEARS. 

Mon, 06/02/2014 - 20:53 | 4818651 CrashisOptimistic
CrashisOptimistic's picture


He's CIO at a fucking bank.  He's basically lower than foot fungus.   He's not a perma bear.  He just wants people who are pessimistic to send him their money so his annual expense ratio or trust management fee or 2/20 or however he bills for advice is padded.

And wait a minute.  Who the fuck said 30% down was a big deal and doomsville.  

30% down is the warm up.  80% down is the real McCoy, and that ain't a bottom.  That's just where it will be the day the diesel is so scarce trucks don't bring food to markets on Manhattan.  That's where it will be when it all shuts entirely because the market staff are out looking for food.  

Ask what sort of recovery the Iraq markets got after they closed.  There is no law of the universe that says a "bottom" ever has to rise again.

Mon, 06/02/2014 - 22:35 | 4818937 rum_runner
rum_runner's picture

I like your narrative but I'm no longer a believer in a grand reset.  Sure there's gonna be crashes and we'll need something powerful to frighten the folks into going along with some monetary buggery (my bet -- a Fed conversion of all UST into a "cold storage" state until "conditions improve").. but in the end cash is fiat flim flam flom.. Weymar didn't resort to cannibalism (though they didn't have EBT cards).. Why is diesel gonna get so expensive that farmers don't plough and delivery people don't drive?

The world ends not with a bang but a whimper.

Tue, 06/03/2014 - 08:51 | 4819724 beachdude
beachdude's picture

Maybe... your comment reminded of Kierkegaard...

“A fire broke out backstage in a theatre. The clown came out to warn the public; they thought it was a joke and applauded. He repeated it; the acclaim was even greater. I think that’s just how the world will come to an end: to general applause from wits who believe it’s a joke.”

Mon, 06/02/2014 - 23:47 | 4819121 RaceToTheBottom
RaceToTheBottom's picture

"There is no law of the universe that says a "bottom" ever has to rise again."

Sometimes there is no bounce, sometimes they just splat.

Mon, 06/02/2014 - 21:00 | 4818644 asking4it2k
asking4it2k's picture

As long as the FEDs QE and ZIRP plans are still going, this market will keep rising!!

Mon, 06/02/2014 - 22:00 | 4818817 thisisjustarand...
thisisjustarandomusernameicreatedforzerohedge's picture

yeah wonder if you went short based on Zero Hedge over the last 5 years, and doubled down with a margin every time Zero Hedge quoted a "market will crash this year" or "look at this 1929/37/etc chart that predicts a market crash soon, what your return would be


Tue, 06/03/2014 - 01:37 | 4819323 thisisjustarand...
thisisjustarandomusernameicreatedforzerohedge's picture

i want to add that this is probably one of the most invaluable websites

and i agree the fundamentals are effed up and there are a lot of technical, social, ethical issues with the market where it's at today. and one day this website likely should, for many technical, social, or ethical reasons, eventually be 'right'

and i feel i learn a lot here. and i think the writers, though sometimes increasingly sensationalist, as a whole do an amazing job and i applaud this website.

so... i don't mean to come off as a jerk. 


but i'm happy i don't invest based on this website

Tue, 06/03/2014 - 03:27 | 4819431 UrbanMiner
UrbanMiner's picture

The markets are largely a fiction, Zero Hedge deals primarily with reality. I trade the markets, I also read Zero Hedge, it's like tight rope walking. 

Tue, 06/03/2014 - 08:39 | 4819698 BeetleBailey
BeetleBailey's picture

Well said Urban....

Tue, 06/03/2014 - 08:37 | 4819697 BeetleBailey
BeetleBailey's picture

Here's my own "lather-rinse-repeat" strategy for these last five years...

Went long and strong in 2008....AFTER THE CRASH....tasty bargains was like being alone in Neiman Marcus with a black American Express card...

Had gold and silver already bought (the real thing, not the silly stawks/ETF's)...waaaaaaay back pre-2006....(think the 300 an ounce range)

SOLD OUT my clients to get their initial investment back in PM's in August 2011....hello. <Verifiable to skeptics>

Now "risk-less"....which the clients love.

At century marks in the DOW, S&P, RUT and QQQ - "pruning"....and began a nibble short program in 2012 -2013.....also PM's for newer clients....and adding to Au coins now.....MF's and stawks bought in 2008,09 are all deeply in the money - some over 100%....

Hedged...correctly....and patience....NO short program in any client portfolio is over 6% of their overall holdings....increasing under hopium "rules"....




Tue, 06/03/2014 - 06:10 | 4819523 BeetleBailey
BeetleBailey's picture

"based on Zero Hedge" the key phrase.

Anyone basing their investment plans based on - ANY- web site's blather is a moron, and should not be allowed to run their own, or others money.

I agree with many posts on here. The way I invest and place my clients money is another story.

A wise man on here (Cog) has the phrase of truth for the decade;

"Know the Truth, but Trade the Lie"

spot on....

Tue, 06/03/2014 - 08:07 | 4819637 Apocalicious
Apocalicious's picture

Cog, I think, also once said the market can remain solvent longer than you can remain rational.


I miss the days when Zerohedge was a lot more Cog, and lot less blather. 

Tue, 06/03/2014 - 08:30 | 4819674 BeetleBailey
BeetleBailey's picture


Mon, 06/02/2014 - 22:07 | 4818838 stocktivity
stocktivity's picture

When the correction does take place, every single one of the talking heads will claim they called it.

Mon, 06/02/2014 - 23:48 | 4819124 failure to perform
failure to perform's picture

I agree. I read the title and said WHEN? WHEN? WHEN? WHEN? Just let it collapse.

Mon, 06/02/2014 - 20:12 | 4818545 JustObserving
JustObserving's picture
A 30% Stock Market Correction in 2014

Kevin Henry will not permit that.  Besides, Yellen will appoint a hundred Kevin Henrys if needed.  The fraud is with us till the bitter end.

Mon, 06/02/2014 - 20:26 | 4818588 insanelysane
insanelysane's picture

There is no way it is going down till at least 2017.  There are more elections to be won and the only people still participating need the market to go up or die.

Mon, 06/02/2014 - 21:09 | 4818700 WhackoWarner
WhackoWarner's picture

You are dreaming.  Until the nightmare cometh

Mon, 06/02/2014 - 20:10 | 4818546 SmittyinLA
SmittyinLA's picture

30% is generaous when you consider all the money losing crap in the market today, BTW what % of tech revenues are from illegal NSA data purchases? 

Could it go away if laws were enforced? 

How many other companies would go under if laws were enforced?

"Uh ya, sorry we're not gonna let you commit fraud, money laundering, and price fix anymore" 

Imagine the horror of a new government or loss of power for the existing govt.



Mon, 06/02/2014 - 20:13 | 4818556 Sticky Wicket
Sticky Wicket's picture

Only 30%? Sounds bullish to me.

Mon, 06/02/2014 - 20:14 | 4818559 q99x2
q99x2's picture

Wouldn't it be nice if the world was not run on FRAUD and rational anaylysis could yield meaningful results. Since that is not the case, pay not attention to this article and you get out there and BTFD.

Mon, 06/02/2014 - 20:16 | 4818564 DerdyBulls
DerdyBulls's picture

I wish he'd put a pair behind his forecast and short it out.

Mon, 06/02/2014 - 20:21 | 4818574 Comte d'herblay
Comte d&#039;herblay's picture

Exactement!!  Why anyone takes these people seriously, and doesn't call them out on these forecasts, on which they seem so certain, is a mystery.  It smacks of desperation on ZH part to find anyone that will support a market crash, the sooner the better.

If you're predicting a 30% correction, back it up and show us the brokers' chits that prove your shorts.



Mon, 06/02/2014 - 20:27 | 4818596 Beam Me Up Scotty
Beam Me Up Scotty's picture

ZH is just the messenger.  Don't kill the messenger.  Robottrader's big tits told me to invest in the S&P years ago and not in gold and silver.  And you know what?  He was right---today anyway.  Tomorrow?  Who knows.

Mon, 06/02/2014 - 20:25 | 4818569 ebworthen
ebworthen's picture

I know they're going to crash it again, but only after Mom and Pop and every pension fund is all in, to the hilt.

I'll believe it when it happens; been hearing this since 2011.

I thought last month might be it, but no such luck.

Maybe this October, maybe December 2016.

Float it until Hitlary is elected?

Mon, 06/02/2014 - 20:45 | 4818636 asking4it2k
asking4it2k's picture

The FED wont let the bubble pop and hurt their "primary dealers". They will keep the party going because if the bubble does pop what will save the economy then?? Would congress get together and end the FED ?

Tue, 06/03/2014 - 12:46 | 4820450 marathonman
marathonman's picture

They can and will let the bubble pop if the real intention is to bankrupt the US and force the SDR on the rest of the world and us.  These goons have bigger hopes and dreams....

Mon, 06/02/2014 - 20:48 | 4818648 Son of Loki
Son of Loki's picture

<< is all in, to the hilt. >>


Thanx for the reminder. I need to empty the remainder of my 401(k) and tap the rest of equity out of my house for the new iHealth app and iTablet and some other shit.

Mon, 06/02/2014 - 21:48 | 4818788 you enjoy myself
you enjoy myself's picture

pension funds are one of the main reasons we'll never see it crash (until the Fed finally loses control).  we'll go the way of Zimbabwe before the Fed would ever allow seniors (read: likely voters) to have their nest eggs blown up.  even with pie-in-the-sky estimates of 8% returns most funds are already insolvent - the SHTF with a 30% correction.

Mon, 06/02/2014 - 22:21 | 4818887 r00t61
r00t61's picture

This article by Chris Martenson said that we were going to have another 2008-type financial crisis.  It was posted on 5/2012.


This article, by Tyler and Nanex, said that the stock market was soon approaching another "Flash Crash."  It was posted on 10/2012.


This article by Chris Martenson said that we were going to have a 40% market correction.  It was posted on 2/2013.


This article by Michael Snyder said that another real estate crash was imminent.  It was posted on 8/2013.


This article by the Japan Times said that there would be a China/Japan war in January 2014.  It was posted on 12/2013.

Despite the forecasts, though, we haven't had a stock market crash.  We haven't had a real-estate crash.  We haven't had Grexit.  We haven't had the derivatives time-bomb go off.  We still haven't seen the end of the petrodollar regime.  We take hit after hit but we still limp along.

What have we seen?  Dow, Nasdaq, S&P all reaching new highs; gold getting slammed lower and lower every day.

I'm not picking on ZH.  Forecasting is definitely hard.  I have articles bookmarked from Mish that claimed that Greece would exit the Euro in 2013; I have articles from Lewrockwell that claimed that gold would reach $2,300/oz by 1/2014; I have articles by FOFOA that claim that gold should reach $50k/oz, etc.  I have a Jim Willie article from 2013 that claimed that the premium over spot for physical silver would soon reach $50/oz; and that the COMEX would soon be shut down because it could no longer deliver any physical gold. I saved a number of posts by one-time ZH user "ekm," who had a lot of interesting things to say about this and that.  His thesis was all predicated on the price of oil, and he forecasted that it would eventually go ballistic, and that would be the catalyst for the collapse. 

That didn't happen, and I don't see ekm posting anymore.

Most recently I have a interview with Gerald Celente from a month ago where he claimed that total economic collapse would commence by 7/1/2014.

I guess Celente still has a month to see whether he's right on that one.

I save all these articles that have a "big forecast" in them, so I can check back on them later.  Like ebworthen said, we've been hearing this crash stuff for years.  Everybody and their mother wants to predict the next crash, just like the few that managed to predict the 2007/2008 crash. 

But most of these forecasts tend to be really wrong.  That's just the way it is.  I'm going to save this Jakobsen article too, and reflect upon it during Christmas of 2014.  We'll see if he's right.

The big stuff seems to come out of left field.  Who was predicting the Cyprus fiasco from a year ago?  Who saw the Libor scandal unraveling the way it did?  Who saw the Ukraine being used in a game of Langley neo-con tug of war?

Not me at least, that's for certain.



Tue, 06/03/2014 - 02:33 | 4819342 Escapeclaws
Escapeclaws's picture

Thanks for this excellent post. I will be following your posts from now on. This is invaluable infiormation.

One thing that gets my goat about these predictions is that we are never allowed to see the thinking prcess behind the prediction. It's always just "Trust me, I'm a financial wizard!" The person then cherry picks his past predictions as "proof" of that. People publishing their predictions should be willing to honestly answer all questions put to them concerning the logic behind the prediction. They should put up or shutup and not use their reputation as a prop.

Haven't heard to much from stackers lately including Gordon Gekko who was advising people to buy gold even when it was near its high. You would think they would be screaming "Buy" now, given that the price is low, but they are nowhere to be heard. Perhaps owing to the decline, they are afraid the price will drop further?The red flag is when there is a "plausible narrative" behind the advice, such as the much-touted hyperinfation hypothesis. The current narratve to get you to buy gold is that it is insurance rather than an investment per se. That way, if the price drops, it is still good insurance. Or how about the story, "The Chinese are buying gold to create a gold-backed currency that will replace the dollar as the world's reserve currency." The red flag here is the phrase, "the Chinese..." Another red flag is "Jim Rogers sez..." Better to have youself tied to the mast than listen to the sirens wailing.

Tue, 06/03/2014 - 10:25 | 4819950 Bloody Muppet
Bloody Muppet's picture

I know they're going to crash it again, but only after Mom and Pop and every pension fund is all in, to the hilt.


You mean when there are no more buyers? That makes sense.

Mon, 06/02/2014 - 20:25 | 4818578 telefunken
telefunken's picture

I thought the crash was set for sept. 2016?! That way they can rush in hilary or 0bam can just stay (i know,i know)

But really why would he leave?The republicans can just fundraise of it and if anyone protests the dept. of edu. can just use their 7 trillion bullets.

 I think "they" have to keep 0 in-hilary is too old (I doubt (physically) she can make it through the primaries and the media has shown it will support anything-He's the perfect demagogue.

 So yea,put me on record for fall '16 crash-at the latest feb '17

 Printing has shown it can go farther than anyone has thought possible and companies (sitting on trillions) can just buy "up" their own stocks...

Mon, 06/02/2014 - 20:24 | 4818585 Democratic koolaid
Democratic koolaid's picture

Shit is gona Inflate throught the summer!

on a side note is there a bubble forming within the newly emerging medical/recreational marijuana stocks, the industy is over-served? 

Mon, 06/02/2014 - 20:26 | 4818592 insanelysane
insanelysane's picture

With all of the circuit breakers in place there is no way the market can drop more than 5%.

Mon, 06/02/2014 - 20:27 | 4818595 world_debt_slave
world_debt_slave's picture

Bullish in this market.

Mon, 06/02/2014 - 20:29 | 4818601 FieldingMellish
FieldingMellish's picture

Everyone expects a 30% correction... so it won't happen. Today was an example of how it won't happen.

Mon, 06/02/2014 - 20:31 | 4818609 ebworthen
ebworthen's picture

O.T.  -but the first 1/2 hour of the PBS NewsHour didn't even mention Ukraine or the neo-Nazi putsch slaughtering civilians with fighter jets.

Middle East coverage, debate about the hostage exchange, and "Global Warming" and cutting the use of coal.

The Birkenstock/Honda/Apple class is not going to know what happened when it all falls apart.

Mon, 06/02/2014 - 22:28 | 4818914 TrustbutVerify
TrustbutVerify's picture


Tue, 06/03/2014 - 08:00 | 4819623 kurt
kurt's picture

The concentrated MSM oligarchs have succeeded. Like "Whack a Mole" any story that goes against the PLAN is knocked down: Whack a Mole Media combined with NeoFascism works!

What explains the bizarro world stock market is the MSM struggling to MAKE markets obey the winning formula whose results have been 5 Sandwars, 3 Eurowars, and multiple Afrowars.

That's where complex trading programs in supercomputers, in Colorado and Utah, come in: hiding in the fog of high speed trading. The reason we all expect a huge crash, as do all the chatterbox eCONomists, is because we are basing our world view on pre-programmed trading patterns, experience, and history. They program traders by punishing them for shorting the market like they punish gold bugs. You might say the shorts pop up like a mole and get hammered down again and again. You might call it the Whack a Mole Media/Markets Matrix.

Mon, 06/02/2014 - 20:40 | 4818622 asking4it2k
asking4it2k's picture

Steen Jakobsen fails to understand money is still pouring into the market because of the FED ZIRP plan. The FED wont let the bubble burst and hurt their "primary dealers".

Mon, 06/02/2014 - 20:42 | 4818623 asking4it2k
asking4it2k's picture

Steen Jakobsen fails to understand money is still pouring into the market because of the FEDs ZIRP plan. Stocks give savers a much beter rate of return.  Plus, the FED wont let the bubble burst and hurt their "primary dealers".

Mon, 06/02/2014 - 20:42 | 4818626 Magnum
Magnum's picture

and gold prices are manipulated to be far less than what the market is willing to pay. riiiight.

Mon, 06/02/2014 - 20:45 | 4818637 esum
esum's picture

my tea leaves said to buy..... oracle after oracle says otherwise... 

is that the "cnbc money on the side" wishing to drive the market down and pounce on cheap stocks.... of course not... that would be immoral... but but but isnt that how the rothschilds made their fortune in engalnd bonds.... but but but aren't they still around manipulating it up make money sell.... short it drive it down... i love this elevator....  

Mon, 06/02/2014 - 20:47 | 4818645 Flounder
Flounder's picture

Yawn...followed by a V recovery to new highs. 

¡Viva la Revolución!
Mon, 06/02/2014 - 20:56 | 4818672 TooBearish
TooBearish's picture

Tylers get a grip - u r goal seeking like ISM - find a bearish MM andhold him up like the next freaking Louis Bacon.  Comon already this thing will not pop until the "owners" r ready to implode it, nutting less.   Have a nice day:)...

Mon, 06/02/2014 - 20:57 | 4818673 TooBearish
TooBearish's picture

Oops duped the entry ...sorry

Mon, 06/02/2014 - 21:00 | 4818681 Spungo
Spungo's picture

30% is extremely optimistic. Tons of stocks would need to drop 30% just to get to a reasonable price, but markets usually overshoot. If the market drops, it's going to be huge. A lot of people seem to be aware that the current market is a bubble, and they're ready to sell off if things start to get sketchy.

Mon, 06/02/2014 - 21:03 | 4818687 enloe creek
enloe creek's picture

who cares no one has any money in the market do they except the pension funds etc

Mon, 06/02/2014 - 21:11 | 4818705 TN Jed
TN Jed's picture

I suspect we all expect but none bet.  Though I bet we all expect to be suspect.

Mon, 06/02/2014 - 21:20 | 4818724 gatorengineer
gatorengineer's picture

I am almost starting to wonder if the muppet-masters behind the Potus are amazed at what they have been getting away with... Now they are trying everything in the book to see what if anything the sheeple will react too.  I think they must be shocked at the complete utter and total lack of response from the masses.....  Hence, I am confident that they can double the money supply from here with narry a blink from anyone....  Brussels will soon have the biggest book in Europe, and no one will blink.

Mon, 06/02/2014 - 21:21 | 4818730 AccreditedEYE
AccreditedEYE's picture

Yet another call for doom upon all mankind. As long as the Fed is running the show, up, up and away.

Mon, 06/02/2014 - 21:34 | 4818758 Smiley
Smiley's picture

Getting doom and gloom burnout.  Seems there is a new 'expert' everyday predicting the end of the financial world.  Would like to see more information based articles not just "because I think I'm a smart guy and I said so" articles on the Hedge...and hot chicks on trampolines.

Mon, 06/02/2014 - 21:35 | 4818761 knowshitsurelock
knowshitsurelock's picture

Wait a minute...

With very low volume trading, no liquidity, massive unemployment, a devastated housing market, poor retail sales, broke consumers, manufacturing screaching to a halt, exploding deficits, huge trade imbalances, low GDP, and falling tax revenues...

The stock market should be breaking out to new highs, right?

Mon, 06/02/2014 - 21:48 | 4818789 rosiescenario
rosiescenario's picture

"We wanted to see through the eyes of a professional economist..."


...or as Mark Twain put it, "As through a glass eye, darkly..."

Mon, 06/02/2014 - 21:49 | 4818799 surf0766
surf0766's picture

What percentage of new issuance is the Fed buying now?  90+...

The rest of the world cares not about the S&P but more about feeding their angry citizens.


Everyone else knows the dollar is on it's last leg no matter what any index is telling you. We all know those can be manipulated.




Mon, 06/02/2014 - 21:52 | 4818802 RiotActing
RiotActing's picture

Fuck does anyone proof read anything on this site? This post is filled with typos...

Mon, 06/02/2014 - 22:41 | 4818958 Bemused Observer
Bemused Observer's picture

Ill prof reed fur you, fur frea...

Mon, 06/02/2014 - 21:59 | 4818809 Kreditanstalt
Kreditanstalt's picture

ONLY "30%"??

After years and years of fake money-induced misallocations of capital, imaginary "interest rates", manipulation and rigging, fake accounting, fiat-money-puffed-up artificial spending power and decades of fractional reserve fraud, 80% would seem a more reasonable "correction"...

Mon, 06/02/2014 - 22:10 | 4818853 Yes_Questions
Yes_Questions's picture




does this mean the other 70% will remain incorrect?

Mon, 06/02/2014 - 22:53 | 4818971 TheRideNeverEnds
TheRideNeverEnds's picture

the shitload of long SPY puts I have in my IRA tell me that corretion wont come in the next 45 days.

Mon, 06/02/2014 - 22:55 | 4818989 monopoly
monopoly's picture

30% is a Correction. Oh. OK> What is a bear market. :)

Mon, 06/02/2014 - 23:08 | 4819022 Iriestx
Iriestx's picture

They own the printing press.  The stock market won't go down by any significant amount until it goes to zero.

Mon, 06/02/2014 - 23:09 | 4819027 user2011
user2011's picture

Sure... hype up the shorts... and then slaughter them again. I think shorts of US markets are going extinct, endangered species.

Mon, 06/02/2014 - 23:33 | 4819092 yogibear
yogibear's picture

See what happened today? The market didn't like the ISM so they revise it a few minutes later to make the market happy.

Goes to prove they will not let this market correct.

Mon, 06/02/2014 - 23:40 | 4819104 JailBanksters
JailBanksters's picture

It's not a Correction it's a Confiscation !

It's bin about 36+ months since the last major Confiscation, so this one should be.....take the money and run NOW.

The sheep have already been fleeced, now the sheeps owners are going to be stripped


Mon, 06/02/2014 - 23:57 | 4819142 AdvancingTime
AdvancingTime's picture

The term "the new normal" has not been used much as of late, but going forward it may be about to return. Many investors and the public at large may be about to realize that central banks can only do so much through printing money and lowering interest rates. Both these actions carry with them some very strong and nasty side effects.

Markets have become very distorted as money has flowed into risky assets in search of higher yields. It could be we are about to see the markets morph into a "realizing market", one that grinds slowly downward. Another possibility is that at some point the wisdom of buying every pullback changes and the market simply drops like a stone. More on what the future might hold in the article below.

Tue, 06/03/2014 - 04:45 | 4819477 kellycriterion
kellycriterion's picture

Predictions? 70%? 90%? Sounds like OPM talking. Predicting isn't so bad if it's also value and consists of about 5% of bets. Having too much fun is fatal.

The biggest risk is falling living standards for 50% or more of the population. Which is and has been realized for some time now. Nominal prices.......

By all means let's not understand the OPM, cost shifting, confiscation complex. Too simple, too dry, not enough drama, multitudes of cherished illusions and defense mechanisms rendered irrelevant.

Tue, 06/03/2014 - 06:47 | 4819551 skipjack
skipjack's picture

It will stop ... when the lower 80% run out of money to keep buying housing, food and gasoline. Then it will be impossible to hide, to extend and pretend.

We're not there yet. There's still a lot of IRA/401ks to loot .

Tue, 06/03/2014 - 06:50 | 4819553 kessguv
kessguv's picture

he talks rubbish.  last time he called for a wee sell off few months back...low of the day near enough and then zoomed up. 

Tue, 06/03/2014 - 09:40 | 4819846 Haloween1
Haloween1's picture

This is the usual tripe out of Chris Martenson's Peak Prosperity blog.  "Making money by fanning the flames of fear" should be his motto.

These periodic articles from Peak Prosperity that show up on ZH are wonderful buy signals. 



Tue, 06/03/2014 - 15:27 | 4820967 tradewithdave
tradewithdave's picture

Altucher 20,000

Wed, 06/04/2014 - 02:07 | 4822342 Mr. Ed
Mr. Ed's picture

",,,we need to activate the SME. So I think we’ll see a progression towards helping the SMEs."

I'd be surprised to see any mainstream econmist push for that... and even more surprised to see how money is gonna be poured onto small to medium sized enterprises.


The Fed and the whole political class knows what really needs to be done:

1) no more welfare for big corporations and the super-rich (yeah, I know, ya didn't have any idea how badly that would turn out for the average person!).

2) get your damn foot of the throat of small business people - the best way to start: pass HR25 and kill the IRS.


(BTW: this is what politicians are talking about when they say "what we really need is restructuring"... they just never get around to any specifics)

Do NOT follow this link or you will be banned from the site!